Paying The Bankruptcy Trustee in a Chapter 7 Bankruptcy

: Reese Baker & Associates

  Filed under: Chapter 7

paymentWhen you file for bankruptcy you will be assigned a professional called a bankruptcy trustee. This individual makes all of the decisions concerning your bankruptcy. This is the person that decides who gets paid and who does not and what assets you are able to keep and those which will have to be sold. This individual has to be paid for their services and how this is done will differ depending on whether it is a Chapter 7 or Chapter 13 bankruptcy.

When you file for bankruptcy you will be expected to submit a filing fee. Out of this money the trustee will receive a small payment. However, if for whatever reason your filing fee does not have to be paid then the trustee will not receive their payment. Once the bankruptcy is underway it is determined if there are any assets that can be sold. If it turns out that there are none and there is no money that can be recovered, for example, through tax refunds or other actions then the trustee receives no further money from you.

In cases where there are assets that can be sold then the trustee will receive a commission based on the amount of money that is paid out to those creditors that have qualified to receive payment. The amount is determined by a sliding scale that depends on the amount that is dispersed. In order for the trustee to be paid they must file an application for compensation with the Houston bankruptcy.